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Marketing and Security Risk Management

October 2, 2009 — sbbcentcom

By Francisco Mateo, CPP, CFE

I have always subscribed to the belief that to effectively evaluate a company’s security risks, you must be familiar with all the moving parts of the business. I find that the business area that provides the most security risk insights is marketing. For a production company, for instance, the way it generates demand should be both synchronized (in theory) to how it produces goods and to how the goods are than delivered to the customers. Marketing therefore is central to the firm’s blueprint. I would take a leap of faith and say that the risk we identified in the marketing strategy of a company could potentially impact up and down the value chain. If that is the case, than we need to look closely at the risk inherent in the marketing strategy.

Let’s take for instance the concept of Visibility, which is essential to position your brand at top of mind for consumers. Your company Wonder-Widgetz LTD wants to maintain its market share, so it aims to regain visibility through all channels. The company has tremendous growth potential in a market, but social mobility has not kept pace with growing population, so poverty levels have fueled a double-digit violent crime rate. Now cue in a global recession, which conspires against value creation. The company decides this is the time to go after the “bottom of the pyramid” consumers, so it speeds up the visibility strategy by placing attractive images of the most popular brands on delivery trucks. Even the sales staff have joined the act by featuring company logos prominently on their vehicles and uniforms.

What kind of risk do you see in this strategy? First of all in the so-called good part of town the benefits in terms of market share outweigh the risk. On the other hand for crime-ridden areas the same vehicles and staff become a bulls-eye for thieves, hijackers and extortionist. How do we compensate? There are opinions both for and against it, but the risk factors remain. Depending on the circumstances, there is no value advertising in this way since the risk of harm to the staff or product being stolen is so great.

My proposal would be to first and foremost know the risk your business is exposed to. One of the most valuable service we as security practitioners can offer our companies is to be aware of crime trends in areas of operation. Crime trends can be obtained from many sources. Many Local Law Enforcement Agencies (LEA) around the world maintain digital databases of crimes committed per capita and by sectors. Some LEAs even make use of sophisticated crime mapping tools. If data is not readily available than you’d have to rely on the old gumshoe work of doing the field work or contracting out the risk appraisal service to a competent security risk assessment professional. Besides crime statistics, it may be necessary to conduct detailed route risk assessment to determine what if any dangers your staff and cargo would be exposed to. Armed with the reliable information on the high crime/violent areas you can begin to plan your security countermeasures. This would require the collaboration of your sales and supply chain teams. If your product distribution requires at-risk staff to enter high crime areas you’d need to make a determination not to display company logos on vehicles and uniforms. You would also have to train your staff to be aware of their surroundings and have a contingency plan if they perceive danger. Many factors (value of the cargo, or attractiveness of the cargo as well as if a ready black market exists) would determine if it’s necessary to contract armed security escort to ensure the protection of your staff and cargo.

As you can see there are many protection strategies that can be implemented, but the best of all is prevention. Deciding whether to emphasize marketing and product visibility or security is a strategic discussion all companies should engage in if the business requires operation in high crime environments.